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More and more car companies are starting to produce electric cars that cost significantly less than Tesla.
S&P Global Mobility has stated that when it comes to electric car models cheaper than $50,000, Tesla has no competition. The most affordable of the company’s electric car models is the Model 3 sedan with a starting price of around $47,000.
Volkswagen, Kia, Hyundai, General Motors, Nissan are the main competitors.
Equally serious competitors are Chinese car companies Nio, Xpeng, Tencent and BYD, which are actively pursuing innovative technologies and have lower costs.
“Throw away everything unnecessary.”
The company has begun development of a cheaper Model 3 to continue to maintain its leadership position and control of the car market.
A simplified version of the Model 3 tentatively dubbed the “Highland” It will have a simpler interior, some changes to the exterior and drivetrain features. The new model will be launched tentatively in 3Q 2023 at Tesla plants in Shanghai and Fremont, California.
Company owner Elon Musk takes the position that the simpler the better in creating the new model.
A month ago at the Baron Funds conference, Musk noted:
“Over and over again, we found parts that weren’t needed. They were put in there just in case or by mistake. We removed so many parts from the car that didn’t do anything.”
Elon Musk
The introduction of the Italian manufacturer’s Giga Press solid casting machines into the process has helped to speed up production and reduce the costs involved. In addition, a battery pack with cheaper modules has already been developed.
A few details
The updated Model S, the Tesla EV premium vehicle introduced last year, served as the foundation for the Model 3 makeover. The standard steering wheel is replaced with an aircraft-style one in this revamp, along with the typical air vents and buttons, creating a minimalist interior with a 17-inch electronic display as its focal point.
In model making, visual style matters a lot, especially given the fact that Tesla has only four models in the range. And buyers tend to equate novelty and visual changes.
Tesla Model 3 sales in China were down 9% amid rising sales from Chinese electric car makers.
The company has offered customers a 9% discount and additional discounts for those who order instant delivery.
Bottom Line
Tesla will find ways to cope with the challenges and make electric cars more affordable for the customer and profitable for the company. And as you can see from the upcoming Model 3 changes, the company’s approach to this issue is thorough.
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